Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, June 10, 1994 TAG: 9406170069
SECTION: BUSINESS PAGE: A-15 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
Four corporate executives and three companies have agreed to plead guilty. The companies will pay more than $8.36 million in fines. The three companies produce more than 90 percent of the plastic dinnerware used in the United States.
After coordinated raids by the FBI and the Royal Canadian Mounted Police, the department's antitrust division obtained indictments in Philadelphia of two company presidents and a vice president. Four other executives and the companies were named in separate charges, filed as criminal informations in Philadelphia as part of bargains for guilty pleas.
The government charged that executives of Plastics Inc. of St. Paul, Minn.; Polar Plastics Mfg. Ltd. of Allentown, Pa.; and Comet Products Inc. of Chelmsford, Mass., secretly telephoned and met with each other to rig prices from December 1991 to December 1992.
One meeting took place in Montreal near the headquarters of the parent company of Polar Plastics, the government said.
In coordinated raids Dec. 8, 1992, FBI agents searched in St. Paul and Chelmsford while Canadian mounted police searched the Montreal office under the U.S.-Canadian Mutual Legal Assistance Treaty.
The case was referred to the Justice Department after an initial investigation by the Minnesota attorney general's office.
Two executives of Polar, one from Comet and one from Plastics Inc. agreed to plead guilty to a price-fixing conspiracy in violation of the Sherman Antitrust Act.
Comet agreed that a fine of $4.2 million would be appropriate. Plastics Inc. agreed to $4.16 million. Polar, which was additionally charged with conspiring to fix prices in the disposable cutlery industry, agreed to plead guilty to all the charges, but the amount of a fine was not immediately determined.
All the executives face possible imprisonment.
In a separate action, a grand jury charged Clement Izzi, president of Comet; Robert Westbrook, president of Plastics Inc.; and Warren White, a vice president of Plastics Inc. with one count of conspiracy to fix prices.
In a second count, Westbrook and White were accused of conspiring to defraud Delta Air Lines Inc. and the Bunzl Corp., both large users of plastic dinnerware, by scheming to charge them higher prices.
The maximum penalty for an individual convicted of conspiracy or conspiring to violate wire fraud laws is five years in prison and a fine equal to either the greatest of $250,000, twice the gain the individual derived or twice the loss caused to the victims.
The Sherman Act carries a maximum penalty of three years in prison and a fine equal to the greatest of $350,000 or twice the gain or loss.
by CNB